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Nimble companies evolve to keep pace with savvy consumers

Nimble companies evolve to keep pace with savvy consumers

naky www.diecastingpartsupplier.com 2015-09-10 15:11:33
Evidence of China’s economic difficulties and the ensuing stock market rout have sent shockwaves around a financially troubled world that has been banking on China to stimulate demand.

But while sales of luxury goods have slumped, some companies focused on ordinary consumers in China are finding ways to maintain their businesses, selling more washing machines and rice crackers as the economy slows.
Analysts say the headlines belie a vast, complex and competitive consumer market where companies have to fight for sales, whether by offering cheaper, smaller package sizes at the lower end or improving their products and customer service.

“Consumer demand has always been there in China and in the past it was easy for companies to grab it,” says Spencer Leung, a consumer industry analyst at UBS in Hong Kong. “But things have slowed and only those who can offer differentiated goods can capture demand.”

He says that multinationals focused on the mass market have been particularly good at maintaining performance as annual gross domestic product growth has fallen from 10 per cent in 2010 to 7 per cent in the second quarter this year. Coca-Cola, PepsiCo and Nike all reported expanding sales in China in recent updates, while Tim Cook, chief executive of Apple, arrested the slide in his company’s shares on Monday after telling a US television show host that he was seeing “strong growth” in China in July and August.

Ben Cavender, an analyst at China Market Research Group in Shanghai, says that while the stock market turbulence has worried some consumers, few are directly exposed given that only

The economy, beset by the underperforming industrial and property sectors, has sapped consumer confidence, but it has also changed the way people buy.

“People are still spending but they are more careful about how they spend, with more focus on features and functions, after-sales support and how products fit in their life,” says Mr Cavender.